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LORENZO M. SARMIENTO v. CA

FACTS:

The case involves a petition for review filed before the Supreme Court, assailing the decision of the Court of Appeals which affirmed the decision of the Regional Trial Court of Davao City in a civil case. The trial court's decision ordered defendants Lorenzo Sarmiento, Jr. and Gregorio Limpin, Jr. to jointly and severally pay the plaintiff bank the principal amount of P495,000.00 plus interest, attorney's fees, and costs of suit.

Defendant Limpin and Antonio Apostol filed an application for a letter of credit with the plaintiff bank for the purchase of scrap iron. The bank approved the application and issued a letter of credit. Defendants executed a trust receipt wherein they acknowledged receiving the merchandise in trust from the bank and agreed to hold the merchandise and to sell it for cash for the bank's account.

Defendants failed to comply with their undertaking, and demands were made for them to pay their account. Legal action against defendants was deferred for settlement, but no settlement was reached. A complaint was filed for the violation of the trust receipt law, and an information was filed against defendants.

Defendants claimed that the scrap iron was lost when the vessel transporting them sank and that it was delivered to a business concern in which they had no interest. After trial, the lower court ruled in favor of the plaintiff bank. The defendants appealed to the Court of Appeals, which affirmed the decision of the trial court.

The defendants filed a petition for review before the Supreme Court, assigning several errors.

ISSUES:

  1. Whether the civil action for the recovery of civil liability is impliedly instituted with the criminal action even if the offended party does not expressly reserve the right to institute it separately.

  2. Whether the offended party in this case reserved the right to institute a separate civil action.

  3. Whether or not the claim for civil indemnity could have been against the defendant in the criminal action.

  4. Whether or not the failure of the trial court to make any pronouncement as to the civil liability of the accused rendered it no longer enforceable.

  5. Whether or not the appearance of the offended party in the criminal case through a private prosecutor constitutes an implied election to have the claim for damages determined in said proceedings or a waiver of the right to have it determined separately.

  6. Whether or not the private respondent's right to file a separate complaint for a sum of money is governed by Article 31 of the Civil Code.

RULING:

  1. The civil action for the recovery of civil liability is deemed instituted with the criminal action unless the offended party waives the civil action, reserves the right to institute it separately, or institutes the civil action prior to the criminal action. The reservation of the right may be expressed or implied.

  2. In this case, the offended party did not expressly reserve the right to institute a separate civil action. However, jurisprudence recognizes that the reservation may be implied from the acts of the offended party or from acts other than those of the latter. The determination of whether there is an implied reservation depends on the facts and circumstances of each case.

  3. The claim for civil indemnity could only have been against the driver and not against the defendant who was not a party in the criminal action. The fact that the claim was not made of record and that no attempt was made to prove damages against the driver or his employer meant that the failure of the trial court to make any pronouncement concerning the civil liability must be due to the fact that the criminal action did not involve any claim for civil indemnity against the defendant.

  4. The failure of the trial court to make any pronouncement as to the civil liability of the accused amounts to a reservation of the right to have the civil liability litigated and determined in a separate action. Nowhere in the Rules of Court is it provided that if the court fails to determine the civil liability, it becomes no longer enforceable.

  5. The appearance of the offended party in the criminal case through a private prosecutor does not per se constitute either an implied election to have the claim for damages determined in said proceedings or a waiver of the right to have it determined separately. The offended party must actually or actively intervene in the criminal proceedings to leave no doubt with respect to their intention to press a claim for damages in the same action. In the present case, the withdrawal of appearance of the offended party's counsel in the early stage of the criminal proceedings indicated that the offended party had no intention of submitting its claim for civil liability against the defendants in the criminal action.

  6. The private respondent's right to file a separate complaint for a sum of money is governed by Article 31 of the Civil Code. The complaint against the defendants was based on their failure to comply with their obligation as spelled out in the Trust Receipt, which is separate and distinct from any criminal liability. The civil action may proceed independently of the criminal proceedings regardless of the result of the latter.

PRINCIPLES:

  • The civil action for the recovery of civil liability is impliedly instituted with the criminal action, unless the offended party waives the civil action, reserves the right to institute it separately, or institutes the civil action prior to the criminal action.

  • The reservation of the right to institute a separate civil action may be express or implied.

  • The determination of whether there is an implied reservation of the right to institute a separate civil action depends on the facts and circumstances of each case.

  • The claim for civil indemnity is only against the defendant who is a party in the criminal action.

  • The failure of the trial court to make any pronouncement as to the civil liability of the accused reserves the right to have the civil liability litigated and determined in a separate action.

  • The appearance of the offended party in the criminal case through a private prosecutor does not automatically imply an election to have the claim for damages determined in the criminal proceedings or a waiver of the right to have it determined separately.

  • The right to file a separate complaint for a sum of money is governed by Article 31 of the Civil Code when the civil action is based on an obligation not arising from the act or omission complained of as a felony.